Job dismissals have emerged as a key dispute between labor and management, casting a pall on the government's efforts to produce a deal on reforming South Korea's rigid labor market.

At issue is whether companies should be allowed to let go of workers who are either negligent or underperforming.

Under the current labor law, companies can terminate an employee's contract if they are either involved in a corruption or an embezzlement case. Companies are also allowed to layoff a number of workers at a time when companies face serious financial difficulty.

Now, companies want to have the legal backing to dismiss workers, as is common in the United States and other countries.

The Korea Employers Federation, which represents the interests of South Korean companies, called for the introduction of a general pink slip.

The parliament "should pass a bill on legalizing a general dismissal" for those who are unfit for their jobs or whose performances are low, said Lee Hyung-jun, who is in charge of labor policy at the federation.

The KEF and other business entities that speak for conglomerates and other large businesses called for a fundamental reform in labor market to boost fairness and flexibility in the labor market.

The business lobbies complained that employment is guaranteed regardless of the capability or performance of workers due to a strict regulation on dismissals, which in turn causes inflexibility.

The business lobbies claimed that companies shun recruitment and instead rely on non-regular workers that they can let go of more easily due to the "burden" of overprotected workers who have vested interests.

Full-time regular employees enjoy "excessive" job security and good pay while non-regular workers are usually paid less. Last year, an average non-regular worker's wage stood at around 65 percent of their full-time counterparts' pay.

President Park Geun-hye has repeatedly vowed to overhaul such issues as labor market duality -- the difference in pay and job security between regular and non-regular workers.

Park has called on labor and management to make concessions to produce a deal on reforming the labor market.

South Korea's labor unions have argued that more must be done to reduce the number of irregular workers instead of just striving to weaken the job security of regular workers.

The Federation of Korean Trade Unions, which boasts nearly 1 million members, voiced its opposition to the introduction of general dismissals.

A dismissal, if introduced, "would make it much easier for companies to fire workers," Kang Hoon-jung, a spokesman for the labor union.

He also said it would make workers feel much more unstable about their job security, claiming the idea of low performance is vague and companies can abuse it.

"Why does the government want to do something that companies could do?" Kang asked.

The dispute comes as the government is pushing labor and management to reach a deal on reforming labor market of Asia's fourth-largest economy.

The government said there should be guidelines for issuing pink slips at a time when some companies dismiss workers through measures such as a voluntary retirement program. (Yonhap)